How Not to Approach New Ventures, and a Review of Michael Stelzner’s “Launch”
In this episode of Gateway to Profits (player below):
How Not to Approach New Ventures, Lessons Learned From the Front Lines
AND
“Launch, How to Quickly Propel Your Business Beyond the Competition” a Review of Michael Stelzner’s new book.
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Full transcript of this episode:
I recently wrote an article at GatewayCFO.com called “When Saying No Can Save Your Hide, an Approach to New Ventures.”
The article has been very popular on the site and linked to by some other great sites. So much so, that I decided to dig into it a little more here. The article pointed out three major pitfalls in brand expansion or new initiatives.
1. Decisions that lead you too far astray from your core business.
2. Decisions that you haven’t accurately assessed the entire potential financial downside.
3. Taking on a large new customer that will represent a huge concentration.
Too far astray from your core!
Started shoot-off because somebody brought a seemingly lucrative opportunity our way. Thought it would be tremendously profitable.
Turned out that we were just getting their scraps.
Further, our people weren’t competent in this specific area. We didn’t have the unique expertise needed.
Lucky to break-even, and eventually shut down the division within a year.
2. Another huge mistake in taking on new ventures, not accurately assessing the downside.
I was involved in another startup some time ago that had only put together one set of projections.
Funding was secured based on these projections.
Things turned out to be more difficult than anticipated and profits were slow to come.
The cash projections were off by about $500,000.
Talk about a lesson learned the hard way!
3. Finally, customer concentration risks.
One, you never want a single customer to represent a large chunk of your business.
It’s a potentially massive cash flow problem and a business continuity problem. What if they go away?
Two, new customers have to be properly scrutinized for credit worthiness.
larger businesses take advantage of smaller businesses all the time.
Don’t get burned. Be sure to perform your due diligence, review their D&B info,
negotiate favorable payment terms and contracts, fully understand the cash flow implications, and be willing to walk away. Remember, they want what you have too.
“Launch, How to Quickly Propel Your Business Beyond the Competition” by Michael Stelzner
Michael Stelzner is the founder of SocialMediaExaminer.com a hugely popular site that brings in over $1mm annually.
The book is really a road map for achieving success online. It’s not your typical online marketing book. Included are some very actionable ideas, how-to’s, examples, and the like.
If you are trying to figure out how your business can use the internet to grow sales, get this book before any other. It’s not enough these days to just have products and services. Competition is so fierce that you have to continually push to maintain your standing as an expert.
You have to continually be pulling all of the marketing and sales levers at your disposal. And that includes the vast array of options for marketing your business online. If you’re not aggressively pursuing an online sales and marketing strategy, then you will lose.
Because your competitors are doing it. And eventually it could be too late for you. The good news is that right now is the perfect time to position your business online.
This book focuses on a huge portion of how to do it, via content marketing.
It doesn’t get into SEO, there’s not much about web video, and he doesn’t say too much about social media. This book is all about using content marketing and building relationships online to grow your business.
How to create this kind of content, how to develop different types of content for different purposes. How to structure it all and keep it all straight. How to build relationships with the biggest and the baddest in your industry. And how to use all of this exposure to market your business. That’s what the book is all about.
The people who do this stuff are winning. I’ve got my copy outlined and marked up all over, which is a testament to how solid I think it is.
Launch, by Michael Stelzner. Pick it up.
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